Indian aviation: A conundrum

The CAPA India Aviation Summit 2012 held in Mumbai recently saw industry leaders engage in dynamic discussions on the existing challenges, future of the Indian aviation sector and investment opportunities.

SummaryThe CAPA India Aviation Summit 2012 held in Mumbai recently saw industry leaders engage in dynamic discussions on the existing challenges, future of the Indian aviation sector and investment opportunities.

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The CAPA India Aviation Summit 2012 held in Mumbai recently saw industry leaders engage in dynamic discussions on the existing challenges, future of the Indian aviation sector and investment opportunities.

CAPA India Aviation Summit 2012 saw stakeholders from the industry voice their forthright opinion on the various issues that make the sector such a challenge despite being a market of high growth rate. Highlighting the various problems afflicting the industry, Peter Harbison, executive chairman, CAPA rued the fact that India is getting replaced as the 'I' from BRIC countries by Indonesia. “And that goes straight to the bottomline of foreign investment in India. However, there is light ahead – there are world class airlines here, the airports are improving, Air Traffic Control (ATC) has improved, and other factors,” he said.

With problems that range from underdeveloped infrastructure to legislative and bureaucratic mindset resting on inertia, the question remains that does India actually care about its aviation industry? The panel discussion focused on doing a reality check on the state of the industry and was moderated by BBC World's Nik Gowing. Talking about the golden years of India aviation, from 2003 to 2008, Cyrus Guzder, chairman, AFL stated, “Airlines started discounting fares heavily though costs went up. There were three mega mergers, then came the oil shock and the mega mergers did not work out. The rupee went weak and still continues, airline profitability slid.” Stressing on the need to have a new airline policy Guzder advocated the need for a transparent policy. “There is a Greek tragedy unfolding on Indian aviation, we have to work with the government behind the scenes to tweak the policy. We need an open and transparent policy.” Joining the discussion, Kapil Kaul, CEO- South Asia, CAPA however felt that regulatory framework will not change. “We are open in air but closed on the ground. We'd like to see the government take aviation very seriously. We need the right skill sets and competency in place,” he

mentioned.

The country needs an aviation policy that focuses on the sector as core infrastructure. Captain Gopinath, chairman, Deccan Charters emphasised, “On regulatory side the government made rules for Air India the first fifty years followed by Jet Airways and Kingfisher Airlines, and then for airport operators. We need strong aviation policy for the country than an airline or an operator. We know that airlines lobbied with the government so that